The Premier Gladys Berejiklian has unveiled the route for the first stage of the new Parramatta light rail, which will stop at 16 places across the city.

The rail project will be built in two stages, with the first leg - a 12-kilometre route connecting Westmead to Carlingford via the Parramatta CBD - to open in 2023.

Announcing the route on Friday, Ms Berejiklian said the project confirmed the government's commitment to the city of Parramatta.

"This is a project that will not just connect major parts of Greater Parramatta but also revitalise communities and help create new ones," Ms Berejiklian said.

However, the Premier and Transport Minister Andrew Constance were forced to defend their decision to drop Olympic Park, which suffers from a major transportation issues, from the first stage.

Mr Constance said the government was "absolutely" committed to extending the light rail to Olympic Park and said the government would "do its homework" before deciding the route of stage two later this year.

"We want to get the station locations right, and the design of the route right," Mr Constance said.

Ms Berejiklian said the she was aware transportation around Olympic Park was "a major issue".

Opposition leader Luke Foley accused the government of abandoning residents and businesses in the area.

"The Liberals have walked away from light rail to and from Olympic Park," Mr Foley said.

The government has committed $1 billion in funding for the project. The business case is yet to be finalised, but the remaining funded is expected to be a mix of so-called value capture and additional contributions from the public purse to pay for the new line.